How Can the U.S. Substantially Reduce Carbon Emissions?

The Kyoto Protocol was developed to mitigate possible future global warming by substantially reducing Developed Countries’ greenhouse gas and carbon emissions.  Congress did not approve the Protocol or other formal commitments to reduce U.S. carbon dioxide (CO₂) emissions.  With the possible recent evidence of increasing global warming or climate change, should the U.S. change course and begin substantially reducing future CO₂ emissions?

Brief U.S. Carbon Regulation History – Most Countries approved the 1997 Kyoto Protocol, which reduces signatory Developed Countries’ CO₂ emissions up to 80-90% in calendar year (CY) 2050.  Even though the U.S. participated in developing the Kyoto Protocol, the Senate overwhelming rejected (95-0) the Protocol due to exempting China and India from CO₂ reductions and possible negative U.S. economy impacts. 

The House of Representatives passed the American Clean Energy and Security Act (ACES, 2009).  ACES would reduce U.S. CO₂ by 83% in CY2050 (CY2005 basis) and was advocated as being critical to transitioning the U.S. from fossil fuels to ‘affordable’ and clean renewable energy.  The EPA/CBO estimated the average Household cost of $150-200/yr. for ACES compliance.  The Senate did not address ACES or similar bills.

Potential ACES U.S. Carbon Emission Impacts – If the Senate-President approved ACES 2009 U.S. CO₂ emissions would possibly be reduced to 1020 million metric tons per year (MMT/yr.) by CY2050.  Accomplishing this reduction requires major changes to current U.S. primary fuels mix and consumption.  In CY2011 coal/petroleum/natural gas fossil fuels accounted for 1870/2300/1300 MMT/yr. respectively of U.S. CO₂ emissions.  The ACES 83% reduction target will effectively require eliminating nearly all coal and petroleum consumption, and significant natural gas consumption.  Although limiting U.S. CO₂ emissions towards 1020 MMT/yr. may be technically feasible, the effects on the Transportation, Electric, Residential, Commercial and Industrial End-use sectors, and the overall economy could be very problematic if reductions are not carefully planned and managed. 

The major weakness of ACES is that the (EIA) projected CO₂ reductions do not directly achieve the 83% reduction target.  Full compliance required purchasing substantial foreign carbon credits.  This carbon credit compliance strategy could significantly compromise actually reducing future CO₂ emissions and mitigating possible climate change impacts.

Reasonable Actions to Possibly Reduce U.S. Carbon Emissions by up to 83% – The following lists rational actions to substantially reduce future U.S. CO₂ emissions by CY2050.  Key assumptions: CYs 2011-2050 energy consumption growth is totally offset by increased efficiency improvements and no carbon credits are used.  Data sources are primarily EIA MER annual totals or averages.

A. Reduced Coal – 93% of coal is consumed in the Electric Power sector and most the balance of coal is consumed in the Industrial sector.  Coal provides ‘base-load’ (fully dispatchable) power generation.  Analysis indicates all Electric sector coal power could reasonably be replaced by zero carbon nuclear (base-load capacity) and renewables.  Due to the variable, non-dispatchable nature of wind/solar renewable power (until reasonably efficient, industrial scale power storage is actually developed), the majority of coal power must be replaced by nuclear.  All coal power (ST-short tons)could reliably be replaced by a combination of 30% renewable wind power and 70% nuclear power as follows:

Further coal reduction should not be planned since this action could negatively impact the Industrial sector’s output.  Estimated new nuclear/wind power capacity required to replace 93% of U.S. coal consumption is 1735 gigawatt-hours per year (GWH/yr.).

B. Reduced Petroleum – 70% of petroleum is consumed by the Transportation sector and 24% by the Industrial sector.  The Transportation sector consumes primarily petroleum motor fuels and Industrial sector uses petroleum largely for feedstocks and heating fuels.  The balance of petroleum is primarily consumed as Residential and Commercial sectors’ heating fuels.  Analysis indicates the Transportation petroleum consumption could be feasibly reduced by about 63% with new ‘electric vehicles’ (EV).  This would include replacing 80% of light duty vehicles and 50% medium duty commercial vehicles with EV’s.  Aircraft, marine transport and the Military would continue to use petroleum at current levels.

The Industrial, Residential and Commercial sectors could feasible replace significant amounts of petroleum heating fuels with heat pumps and other electric power technologies.  Based on these changes, current U.S. petroleum consumption (MBD = million barrels per day) could be reduced as follows:

The 9.8 MBD reduction in petroleum consumption would eliminate all imports and a significant amount of existing domestic production.  Further petroleum reductions should not be planned since this action could negatively impact the mobility of most Residents, and the Industrial sector’s outputs.  Estimated new nuclear/wind power capacity required to replace 52% of U.S. petroleum consumption (by EV’s and heat pumps) is 1570 GWH/yr.

C. Reduced Natural Gas – Industrial/Electric/Residential sectors consume 33%/31%/19% respectively of total natural gas.  Natural gas is used primarily for heating and turbine/motor fuels.  Some of these heating/motor fuels can be replaced by a combination of heat pumps and electric motors.  All Residential gas appliances could also be replaced by electric technologies.  Due to the large increase in variable, renewable wind power and the need to maintain power grids reliabilities, analysis indicates no significant reduction of Electric sector natural gas capacity should be planned.  Based on maintaining existing natural gas (peaking) power and electric technology changes, natural gas balances (CF = cubic foot) could be reduced as follows:

Further reductions should not be planned since this action could negatively impact Commercial and Industrial sectors’ outputs, and put the electric power grids’ reliabilities at risk.  Estimated new nuclear/wind power capacity required to replace 27% of U.S. natural gas consumption (by heat pumps and electric drivers/motors/appliances) is 865 GWH/yr.

Feasible U.S. CO₂ Reductions from Substantially Reducing End-use Sector Fossil Fuels – Based on the above analysis and actions to replace fossil fuels with zero carbon nuclear and wind power, U.S. total CO₂ emissions could be reasonably and reliably reduced as follows:

This analysis indicates that based on existing proven technologies U.S. CO₂ emission for CY2050 can only be reasonably reduced by 62% (vs. 83% ACES target).  Further reducing U.S. CO₂ means some combination of significantly restricted Transportation usage, and shutting down significant Industrial and Commercial activities/outputs; i.e. reduced consumption or increased imports.  Increasing foreign goods imports does not reduce world CO₂ emissions and increases U.S. trade deficits.

Costs to Reduce U.S. CO₂ Emissions by 62% – Total estimated new zero carbon power generation capacity required to replace coal, petroleum and natural gas is 4170 GWH/yr.  This would change U.S. electric power mix and capacities as follows:

The largest source of electric power would become nuclear followed by wind.  Power grids reliabilities should be reasonably stable with variable renewable power limited to about 21%.  Total new nuclear + wind power capital costs are conservatively estimated at $3.5 Trillion (2010 cost basis).  This is an enormous investment, and amortized over 35+ years is estimated to increase average delivered power costs by about 50% over current prices.  Although this represents a $570 Billion/yr. increased total U.S. power costs, nearly all these energy cost increases would be offset by reduced fossil fuels consumption costs.  The majority of CY2050 fossil fuel cost savings would be due to reduced petroleum consumption and imports. 

Even though increased power costs will be almost totally offset by reduced fossil fuel costs, consumers will still be required to pay for new EV’s and associated infrastructure, new electric heat pumps, appliances, etc. and the maintenance of these new technologies.  Estimated total annual costs (indirect/direct) are $275 Billion for all consumers.  This means the average U.S. Household’s annual expenses will increase by about $2100/yr. (2010 cost basis), which is ten times the original EPA/CBO estimates for ACES 2009 compliance.

Not included in the above cost estimates are the assumed energy efficiency improvement costs and other possible indirect costs.  If future energy inflation and the cost effects on most goods and services exceed increases in average Household income, the economic impacts of reducing U.S. CO₂ emissions by 62% could be significantly greater than the estimated $2100/Household-year.

Global Impacts of Reducing U.S. CO₂ Emissions by 62% – In recent years most Developed Countries have made significant progress in reducing their CO₂ emissions.  Developing Countries CO₂ emissions have, however, increased very significantly.  Refer to the following EIA data (based on fossil fuels consumption) of the top six World CO₂ emitters:

Up to CY2005 the U.S. was the largest emitter of World CO₂ emissions.  In CY2006 China became No.1 and continues to grow at alarming rates.  Despite not formally approving the Kyoto Protocol, U.S. CO₂ emission reductions are similar to other Developed Countries.  The obvious gap in the Kyoto Protocol is exempting Developing Countries and the continuous world CO₂ emissions growth.  Even though this analysis shows that the U.S. can reasonably reduce current CO₂ emissions by 3380 MMT/yr. after investing many $Trillions in future years, China’s current CO₂ emissions growth rate will likely offset all possibly U.S. CY2050 CO₂ reductions within the next few years.

Should the U.S. Substantially Reduce CO₂ Emissions? – Reducing current U.S. CO₂ emissions by 62% will increase average Household’s expenses by at least 5%/yr.  This will substantially reduce Middleclass Household discretionary income for purchasing other goods and services beyond basic family necessities.  Further CO₂ reductions are feasible, but will require very significant changes to the U.S. economy and likely most Resident’s current standard of living.

How much reducing U.S. CO₂ emissions by 62% can tangibly help reduce climate change is very uncertain.  The largest obvious risk is the expected growth in China’s economy that will more than offset all economically feasible reductions in U.S. CO₂ emissions.  Possible negative impacts on the overall U.S. economy by redirecting $Trillions of investment into more costly zero carbon energy supply projects is an additional concern.  Another possible risk is the ongoing debate and level of uncertainty as to the actual impacts of CO₂ on climate change and whether substantially reducing anthropological sources will tangibly benefit the U.S. or the world.

How to Manage Carbon Reductions and Impacts – Substantially reducing U.S. fossil fuels consumption could be achieved by a number of regulatory strategies.  Politically popular cap-n-trade and carbon credits are problematic.  Besides effectively increasing costs further for average Households (above the levels estimated in this analysis), actual reductions in CO₂ emissions by use of carbon credits are significantly uncertain.  A more effective strategy could be through maximum free market engagement (not cap-n-trade).  A more promising strategy would involve the Federal Government creating a combination of reasonably aggressive ‘zero carbon power standards’ and ‘increased efficiency standards’.  Rather than having the Government pick winners/losers, the free markets would decide which new energy mix/efficiency technologies should be developed to meet zero carbon power/efficiency standards.  The Government’s role should be limited to supporting energy R&D and helping facilitate the new power plants and transmission & distribution lines construction permitting processes.  Limited duration zero carbon power production subsidies should also be considered, but these must be managed within current-future Federal deficit spending.

Another factor that should be included in the new CO₂ emission reduction regulatory strategy is the need to reduce petroleum fossil fuels first to offset the added costs of zero carbon power and other technologies.  If only coal is first replaced with nuclear/wind power, no reduction in overall energy cost would result.  This effectively doubles the costs of overall energy expenses for average Middleclass Households; consuming up to at least 10% of future average annual incomes.  Another benefit of requiring initial CO₂ reductions come first from reduced petroleum consumption is U.S. energy security.  This analysis shows that reducing petroleum fossil fuels substantially increases U.S. energy security by eliminating all oil imports. 

Putting priority on replacing petroleum with nuclear/wind power also effectively ‘hedges’ the risks-benefits of reducing U.S. CO₂ emissions.  The performance risks of climate change improvements could effectively be hedged or reduced by initially requiring that all CO₂ reductions result from reducing petroleum consumption-imports.  Even if China increases their CO₂ emissions greater than feasible U.S. reductions, the potential lack of climate change improvement would be effectively offset by the value of increased U.S. energy security.

In Conclusion – The U.S. could reasonably achieve a 62% CO₂ emission reduction, but the costs of replacing fossil fuels will be quite substantial and the impacts on the economy uncertain.  To reasonably reduce future CO₂ emissions a new regulatory strategy is needed to properly manage costs, risks and overall performance.  If future climate change performance proves reducing CO₂ emissions are ineffective, than the plan should be changed to more cost effective alternatives such as investing in ‘adaptation’ projects to best manage uncontrollable global warming impacts.

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